Blake Borgeson, in blog form

suspected facts. validated opinions.

using a speculative market to decide our laws? (“futarchy”)

with 4 comments

I just learned of this idea today, and it caught my attention.  The post I’m referring to:

The two sentence version:

In futarchy, democracy would continue to say what we want, but betting markets would now say how to get it. That is, elected representatives would formally define and manage an after-the-fact measurement of national welfare, while market speculators would say which policies they expect to raise national welfare. The basic rule of government would be:

When a betting market clearly estimates that a proposed policy would increase expected national welfare, that proposal becomes law.

I haven’t yet digested this much, but I wanted to see what other people’s initial reaction was to the idea. Is it something we should be discussing more? Obviously it’s not realistically going to happen anytime soon, but with what we’ve learned about markets even in the past decade, what do you think?

Written by blakeweb

September 9, 2008 at 6:09 pm

4 Responses

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  1. I'm for it – the mechanisms of republican democracy are long due for an update to modern philosophy and technology. However, don't start at the national level. Let state, county, or city governments experiment first.


    September 10, 2008 at 1:19 am

  2. My first thought is whether or not the futarchy proposed policy would fare well in its own system, or whether the betting market would estimate a failure…i have my opinion…

    Dan Graham

    September 10, 2008 at 1:38 am

  3. Good point. It actually does seem reasonably achievable to do some experimentation of this sort at the local level. Experiments with governance on a national level may have to wait until the first seasteading ( colony is launched. =)


    September 10, 2008 at 7:17 am

  4. That's true–I think right now the idea definitely doesn't have a lot of support yet. Maybe we need an authoritarian government to bridge the gap…with me in charge. =)


    September 10, 2008 at 7:18 am

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